Birds Eye Frozen Foods was started in 1938 and was a market leader in the UK frozen foods industry, accounting for over 60% of sales in the 1950s-1960s. However, its market share began declining in the 1970s due to rising competition and as it failed to adapt its marketing strategy to changes in consumer preferences and the number of market segments. By the late 1970s, Birds Eye's profits had halved and it registered losses as it struggled to respond to these challenges. The company implemented a strategy to sell more private label products, reduce unprofitable product lines, maintain its brand quality, decrease vertical integration by outsourcing suppliers, and develop partnerships.

1. Birds Eye Frozen Foods –
Case Study
GROUP 1
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2. HISTORY
• Started by Robert Ducas, chairman of a Kent engineering
company, Winget Ltd. in August 1938.
• Owned by General Foods Corp., Robert Ducas, and Chivers
and Sons Ltd (a British canner and Jam-maker).
• In March 1943 Unilever acquired Birds Eye Foods.
• Throughout the 1950s and 1960s, Birds Eye accounted for
over 60 percent of UK frozen food sales on a tonnage basis.
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3. KEY ISSUES
• Decline began in the 1970’s
• Birds Eye’s market dominance existed primarily in sales of
small retail packs to independent grocers and to a lesser
extent, supermarkets.
• In home freezer centers its share was around 8 percent (1974)
• In catering sector, Birds Eye’s market share was about 10
percent (1973)
• Widened product range and increased range of market
segments posed major difficulties for Birds Eye’s marketing
strategy and the allocation of its advertising budget.
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4. Cont…
• Between 1977 and 1980 expenditure on its modernisation
program amounted to some £20 million.
• In the face of rising competition, (King Harry Foods in
1970, White House Foods Ltd. and Fife Growers Ltd in
1971, and Wold Growers Ltd in 1974), Birds Eye maintained
its advertising budget during the mid-1970s while cutting
prices on some major-selling products
– Higher Sales, profit margins halved
– 1976, the company barely broke even and in 1977 it
registered a post - tax loss.
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5. STRATEGY
• Selling to private labels: They had gained market share of 21%
in 1978.
• Reduce product lines: concentrate on profitable product lines
and promote higher margin products.
• Maintain brand: Focusing on high quality products.
• Decrease vertical integration: Transaction costs are lower if
supply is outsourced.
• Focus on developing short term and long term partnerships.
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6. IMPLEMENTATION
• Prior to divesting infrastructure, replacement must be able to
meet quality standards set by Birds Eye.
• Strict oversight and co-ordination of activities done by
supplier; ensuring no loss in quality.
• Reinvest savings to marketing and branding of products.
• Regain lost market share and profit margins.
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